By Greg Peel

The Dow closed up 1 point while the S&P fell 0.3% to 1324 and the Nasdaq dropped 0.3%.

Will profit-taking be the story of this quarter's US earnings season? If Alcoa is any guide it might be. After the bell on Wall Street the aluminium leader and Dow component reported US28c earnings per share against a US27c estimate but the shares are down 4% in the after-market as we speak. Alcoa did come up slightly short on the revenue line, once again suggesting cost-cutting is still bolstering P&L statements as business takes a long while to recover.

Wall Street has run strongly ahead of this earnings season and despite all that's being going on in the world, which suggests that unless results are spectacular there could well be more risk to the downside than the up, at least in the shorter term. Alcoa is but one swallow nevertheless, and we can look forward to another month's worth of results. This week's further highlights will be JP Morgan on Wednesday and Bank of America on Friday, book-ending Google on Thursday.

Wall Street started with a bang last night with the Dow up over 60 points which was largely to do with a fall in the price of oil, but the afternoon saw a square-up. For oil, three factors combined to send Brent down US$2.67 to US$123.98/bbl and West Texas down US$3.93 to US$108.86/bbl.

Firstly, the US dollar had fallen heavily on Friday night sending oil higher as it appeared the US government might shut down at midnight. That fear has since been averted, so last night the US dollar recovered 0.25% on its index to 75.04.

Secondly, the African Union has managed, apparently, to convince Gaddafi to call a ceasefire and enter into resolution talks with the Libyan rebels. Anything Gaddafi says must be taken with a grain of salt, but either way some pressure is removed from the oil price for now.

Thirdly, Goldman Sachs had been running as a recommended trade a commodity basket known as the CCCP, being crude (40%), copper, cotton and platinum. Last night Goldmans suggested the trade had run its course and it was time to get out with a nice profit. Commentators speculate that Goldmans sees US$110 West Texas as the point at which, once translated into gasoline pricing, demand destruction begins as Americans begin to consciously use less oil. It is then no longer a supply-side issue (less oil from MENA) but a demand-side issue.

With the US dollar bouncing back from its shut-down lows, everything that shot up on Friday night saw a pullback last night. Gold fell US$11.70 to US$1463.30/oz, silver slipped 2%, and copper was down 0.5%. Nickel bucked the trend nevertheless.

The Aussie dollar dropped 0.7% to US$1.0492.

The close in the ASX 200 yesterday at 4971 represents a new post-GFC high. The move up yesterday to that point was nevertheless dominated by BHP ((BHP)) which shot up when management scotched rumours of a Woodside ((WPL)) foray. Smarter heads could never see justification for such a deal in the first place.

We are yet to see an impact from the inevitable knock-down ahead when Leighton ((LEI)) comes out of its halt, as we are reminded that there is one helluva brick wall at 5000 in the ASX 200 given that level provided staunch support for months before Lehman eventually brought the world undone. We won't be seeing 5000 today if the SPI Overnight is anything to go by. It was down 20 points or 0.4%.

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